By Ahmed Tabaqchali, CIO of Asia Frontier Capital (AFC) Iraq Fund.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

The herd instinct among forecasters
makes sheep look like independent
thinkers
” — Edgar Fielder

The crash in oil prices, brought on by the oil price war between Russia and Saudi Arabia, and the collapse in consumption due to COVID-19, seems like the perfect storm to hit Iraq given its vulnerabilities to such external shocks.

Though, this is not the first perfect storm to hit it. The last one which was arguably more perfect than the current one took place in the summer of 2014 when ISIS took over a third of the country, threatening its imminent break-up, and for good measure oil prices crashed.

As in 2014, the fall in oil prices poses serious threats to Iraq’s oil-dependent economy, but the current storm hits a very different Iraq from that of 2014 – especially changed this time is its equity market. Then, the equity market was at the end of a multi-year bull market that, as measured by the Rabee Securities RSISX USD Index (RSISUSD), had almost doubled by early 2014 from the levels of 2010.

Comparatively, now the equity market is at the end of a multi-year bear market that saw it decline 71% from the 2014 peak. Fuelling the 2014 bull market were foreign investor inflows and the government’s multi-year investment spending program which boosted the economy and domestic liquidity. The opposite is true in the current bear market with most foreigners having withdrawn from the market and the government’s investment spending having been practically non-existent for a number of years.

RSISUSD Index: Bull market 2010-2014 – Bear Market 2014-2020

(Source: Bloomberg)

The significant drop in oil revenues will force the government to sharply curtail expenditures in the same way that it did in 2014-2016, with negative consequences for the economy, yet unlike then the cuts will not be magnified by the need to shift resources to the sharply increasing cost of the ISIS conflict. The combination of the different profiles of investment spending and expenditures have vastly different implications for both the economy and equity market.

In 2014-2016 the dramatic cuts to investment spending and diversion of resources towards the war effort led to year-over-year contractions in non-oil gdp of 3.9% and 14.4% in 2014 and 2015 respectively. The severity of the drop was such that the small bounce of 1.3% in 2016 was followed by a 0.6% drop in 2017. The multiplier effect of these contractions negatively impacted corporate earnings and ultimately led to the equity market’s multi-year decline.

Today’s different circumstances mean that the non-oil economy will not face the same severe double whammy as then, and as such the contractions will be of a different magnitude. It will nevertheless be negatively impacted by the effects from the COVID-19 lockdown far more than any cuts to the government’s investment spending. While every sector of the economy will feel the effects of the lockdown, the informal sector which is dominated by retail and hospitality and which accounts for the bulk of private sector economic activity will be particularly hard hit. Whereas, these effects on the equity market will be through a few sectors that dominate the market, consisting of banking, telecoms and consumers staples.

The banking sector was hurt the most between 2014-2016 as the cuts to the government’s investment spending were disastrous for private sector businesses at the receiving end of the cuts, whose finances deteriorated. This in turn affected the quality of bank loans as these businesses accounted for the bulk of bank lending. Consequently, the banks’ earnings suffered from the increasing non-performing loans (NPL’s) coupled with negative loan growth, as well as losing funding sources due to negative deposit growth. The scale of the effects on private sector businesses from any future cuts by the government ought be smaller this time around and should not lead to the same negative effects for the banking sector. However, it would be reasonable to assume that the sector’s tentative recovery will be on hold, while any reversal would be limited given the nascent recovery prior to the COVID-19 shock and the sector’s limited exposure to the informal economy. With the sector contributing the most to the market’s 71% decline from the 2014 peak, it’s difficult to see how bank stock prices can decline much further in response to these developments.

Other reasonable assumptions that can be made are that telecom stocks could benefit from the increased need for broadband induced by the lockdown, while any moderation in consumption for soft drinks – whose local bottler accounts for the bulk of the consumer staples sector market capitalization in the equity market – should be limited. These are very early thoughts and much more data, on the economy and company specific, are needed before any meaningful analysis can be made. However, such data and analysis in the short term will play second fiddle to shifting expectations on the future direction of oil prices.

Forecasting the direction of oil prices, especially at critical junctures, is fraught with uncertainty, as subsequent prices have made a mockery of all predictions throughout recent history: from those calling for ever higher prices when “peak oil” was the consensus thinking, to those calling for ever lower prices when “lower for longer” became the consensus. However, analysing the supply-demand for oil, while equally fraught with uncertainty, it is possible to analyse a few broad trends to help frame expectations for the general direction of prices.

The effects of the lockdowns related to COVID-19 have been profound on the global demand for oil given that about 60% of consumption comes from transportation. The first contraction in demand was seen when China went into lockdown in January and expanded as the rest of the world followed suit in March. Current expectations call for a decline in April of up to 20 million barrels per day (mbbl/d) from initial world oil demand estimates of 101mbbl/d.

The known nature of the virus precludes a return to full normalcy when global lockdowns are expected to ease from mid-summer onwards. Combined with the unknown nature of the new normal as the world learns to deal with and ultimately contain the virus, the return to a pre-virus oil demand picture is unlikely within the next 12 months. But, in six to nine months demand for oil should recover from the extreme lows of April and trend upwards to a small drop from base-line demand by year end, as suggested by the chart below.

Global Oil Demand Impact from COVID-19

(Source: CNBC 26/03/2020 citing Goldman Sachs Investment Research, International Energy Agency, Bloomberg, Reuters, New York Times)

The supply-side of the equation is much harder to predict given the multitude of possibilities of producer reactions to low, yet extremely volatile oil prices in which a great deal of oil production becomes uneconomical. The International Energy Agency (IEA) estimates that about 3.8-5.0mbbl/d of global production is uneconomical at $25-30/bbl prices for Brent crude. The industry has responded to the severe price drop by cutting expenses and in particular capital spending plans with the IEA reporting a range of 20-30% in cuts to initial plans for 2020. It would be reasonable to conclude that these and other actions would lead to the removal of about 2-5mbbl/d from an initial supply estimate of 102mbbl/d for 2020. But these will take a few months to alter the supply-demand imbalance and as such all the excess supply will end up in storage.

Global crude storage capacity will likely be maxed out in the next few weeks, currently estimated at 63% capacity with an effective full capacity at 80%, which will force additional significant production cuts above and beyond the above mentioned 2-5mbbl/d – this time by economically viable crude producers. This will likely accelerate, or pre-empt, the currently discussed plans for a new round of coordinated production cuts by OPEC+, or OPEC++ if other countries such as the U.S. join.

All of the above will likely mean that oil prices will remain under pressure for the next 9 to12 months, probably in a price range of $30-40/bbl for Brent crude. However, with a return to some sort of post-lockdown normalcy in early 2021, low oil prices should stimulate demand, and coupled with the massive worldwide fiscal stimuli to the global economy should begin to recover. Following a time-lag, as demand absorbs the stored supply, the supply-demand picture should be tilted in supply’s favour, and oil prices will trend higher – likely to a price range of $45-55/bbl for Brent crude.

The outlook for Iraq, within this scenario, i.e. an average of $30-40/bbl for Brent crude over the next 12 months, is far from benign, but hardly bleak. As noted here in the past, the economic consequences from the continued political paralysis would be that no new budget will be passed, and thus the government will continue to implement the current spending parts of the 2019 budget. However, it will embark on dramatic cuts to investment spending plans and expenditures on goods and services, though it will maintain expenditures on salaries, pensions and social security. These measures could lead to annual expenditures of $69bn resulting in a cumulative 12-month budget deficit of $25bn-38bn. This can be comfortably funded by indirect monetary financing by the Central Bank of Iraq (CBI), with its foreign currency reserves of $67bn as of the end of 2019.

Beyond the next 12 months, Brent crude prices in a range of $45-55/bbl will remove much of the pressure on government finances, but the exact timing of the post-lockdown return to normal with the new level of oil prices means that Iraq cannot avoid embarking on an accelerated and significant set of economic reforms, previously agreed to with the IMF in the 2016 Stand-By Agreement (SBA) but abandoned when oil prices recovered in 2018. However, with an increasingly alienated population these reforms would not come about without meaningful political reforms.

As a measure to contain the outbreak of COVID-19, the government announced a one-week nationwide curfew, starting on March 16th that was extended twice to April 11th. Trading on the Iraq Stock Exchange (ISX) was suspended in response to these instructions and the market, as measured by Rabee Securities RSISX USD Index (RSISUSD), ended the month down 7.1%.

The concentrated selling in the few foreign favoured stocks that began in January continued into March. However, as in February, the list narrowed further, and turnover declined. Given the uncertain global economic outlook, this selling could continue when the market resumes trading. Nevertheless, as Iraq’s equity market was discounting neither an economic nor a corporate earnings recovery, it’s difficult to see why it should decline as other markets have elsewhere. Most global markets have had multi-year bull markets and would need to discount vastly different economic assumptions than those that led to their multi-year rises. This explains the better action by the ISX compared to other markets during the recent sell-off – the decline, at least until March 16th, was less than other markets as can be seen from the chart below and arguably makes the risk-reward profile more attractive for the ISX versus these markets as portfolio allocations are rebalanced in the light of the changed global environment.

Trailing 12-months normalized returns for the RSISUSD Index vs MSCI World Index, MSCI Emerging Markets Index and MSCI Frontier Markets Index.

(Source: Bloomberg)

Please click here to download Ahmed Tabaqchali’s full report in pdf format.

Mr Tabaqchali (@AMTabaqchali) is the CIO of the AFC Iraq Fund, and is an experienced capital markets professional with over 25 years’ experience in US and MENA markets. He is a non-resident Fellow at the Institute of Regional and International Studies (IRIS) at the American University of Iraq-Sulaimani (AUIS), and an Adjunct Assistant Professor at AUIS. He is a board member of the Credit Bank of Iraq.

His comments, opinions and analyses are personal views and are intended to be for informational purposes and general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any fund or security or to adopt any investment strategy. It does not constitute legal or tax or investment advice. The information provided in this material is compiled from sources that are believed to be reliable, but no guarantee is made of its correctness, is rendered as at publication date and may change without notice and it is not intended as a complete analysis of every material fact regarding Iraq, the region, market or investment.

By John Lee.

Iraq’s National Investment Commission (NIC), in coordination with the General Committee for Free Zones, has announced the following investment opportunities:

  • The expansional area in Khor Al- Zubair on the land lot No. (13/8 M 44 Hila and 1/3, 2/2, 1/3 M 20 Shaawan) with total area of (20,364,200 M²) that is overlooking khor Al- Zubair stream and adjacent to the sea port and the Fertilizers company with only 55 km paved distance from Safwan border point and full covered by the power grid services.
  • Qaem [al-Qaim] Free zone , on the land lot No. (133/7533 M 21 Deyom Al- maneai) with total area of (430,000 M²) , the land is adjacent to Qaem Border Point and near to Electricity and water sources and close to the center of Qaem District while only (25) km distant from Ukaz gas field.
  • Lands allocated for free zones in Qaem – Ukashat , on the land lot No. (133/7533 and 11/5 M 21 Deyom Al- maneai) with total area of (6,612,500 M²) , the land is adjacent to Qaem Border Point that is only 20 paved kilo meters distant from its strategic location which is close to the Phosphates factory in Ukashat near Ukaz Gas field.

Willing investors are invited to apply through sending their applications to the One Stop Shop dept. of NIC oss@investpromo.gov.iq or by visiting the General Committee for Free Zones in Baghdad – Nidhal Street – White palace next to the Building of the General Committee for customs.

(Source: NIC)

By John Lee.

IFC, a member of the World Bank Group, is investing over $26 million in a new 161-bed hospital in Erbil in the Kurdistan Region of Iraq.

The facility will increase the availability of quality healthcare services and help address gaps in the country’s healthcare infrastructure. The $92 million Seema Hospital project is expected to open its doors in 2021. In addition to providing core health services, it will be one of the city’s first private hospitals with oncology, radiotherapy, and burn units.

Treatment capacity in existing public and private healthcare facilities in Iraq is limited, with damages to the system estimated at $2.3 billion because of the conflict, according to a World Bank report. The hospital is owned by the Macrom Company for General Trading.

Yaseen Al Bazzaz, Chairman and Chief Executive Officer of Macrom Company for General Trading, said

“Since opening our first hospital in 2006, we have grown into a leading provider of specialized health care services … Hundreds of patients are traveling desperately to neighboring countries for their medical needs. This will change once Seema Hospital opens and provides top-notch healthcare solutions.”

IFC is also contributing technical expertise, advising on environmental and social best practices, and providing guidance on corporate governance. The project is part of the World Bank Group’s strategy in Iraq to develop social infrastructure. Seema Hospital also will be one of the first buildings in Iraq to be certified by IFC EDGE, a platform that helps to determine the most cost-effective options for designing green buildings.

Tomasz Telma, IFC’s Senior Director for Manufacturing, Agribusiness, and Services, said:

“Iraq is a priority country for IFC, and we are committed to supporting its economic growth and health infrastructure … Investing in quality hospitals helps improve care, especially where there is often limited access to effective secondary and tertiary facilities, and introduce expertise, technology, and best practices to these markets.”  

IFC has increased its investments in Iraq during the last decade. Its committed portfolio stands at about $254 million, up from $20 million in 2010.

As Iraq and other countries battle COVID-19, the World Bank Group, in response to the crisis, has announced $14 billion package of financing to help support  countries to strengthen health systems and improve disease surveillance worldwide.

(Source: IFC)

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Rabee Securities Iraq Stock Exchange (ISX) market report (week ending: 12th March 2020).

Please click here to download a table of listed companies and their associated ticker codes.

The RSISX index ended the week at IQD612 (-5.7%) / $654 (-6.5%) (weekly change) (-12.7% and -12.7% YTD change, respectively). The number of week traded shares was 7.4 bn and the weekly trading volume was IQD5.4 bn ($4.4 mn).

ISX Company Announcements

  • Iraqi for Seed Production (AISP) will hold a GA on Apr. 5, 2020 to elect 4 original and 4 alternative board members. The company had been suspended from trading since Nov. 12, 2019 due to not disclosing its 2019 financial statements.
  • ISX will suspend trading of Karbala Hotels (HKAR) starting Apr. 12, 2020 due to the AGM that will be held on Apr. 15, 2020 to discuss and approve 2017 and 2018 annual financial results.
  • ISX requested Al Taif Islamic Bank for Investment & Finance (BTIB) on Mar. 11, 2020 to provide their public subscription result.
  • Gulf Insurance and Reinsurance (NGIR) resumed trading on Mar. 9, 2020 after discussing and approving 2018 annual financial statements.
  • Al-Ameen Financial Investment (VAMF) resumed trading on Mar. 9, 2020 after electing 5 new original and 5 alternative board members.
  • Cross transaction: 3.0 bn shares of Trans Iraq Bank for Investment (BTRI) on Mar. 10, 2020, which represents 1.1% of BTRI’s capital.

By John Lee.

The National Investment Commission (NIC) has announced the following investment opportunities:

(Source: National Investment Commission)

By Ahmed Tabaqchali, CIO of Asia Frontier Capital (AFC) Iraq Fund.

Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

By February’s end the market, as measured by the Rabee Securities RSISX USD Index (RSISUSD), was down -3.7%.  The month saw a continuation of the heavy foreign selling in January and mostly in the same foreign favoured stocks, i.e. Baghdad Soft Drinks (IBSD), Asiacell (TASC), and Mansour Bank (BMNS). However, not only was this foreign selling comfortably absorbed by local buying, but its effect on the market was much smaller than previous instances of foreign selling as can be seen from the chart below:

(Source: Iraq Stock Exchange, Rabee Securities, Asia Frontier Capital, daily data)

The most recent instance of such concentrated foreign selling was in January-February 2019, which although much smaller in absolute amounts, led to declines across the board that took the market to multi-year lows. It should be noted that foreigners were buyers too in instances of concentrated foreign selling, but that the selling then soured local sentiment and so was the main driving force behind the weakening prices which lasted even when the selling subsided.

The most promising aspect of the current market’s action is that while overall market turnover expanded meaningfully in both of January 2020 and February 2020 versus the turnover of the last 12 months, it was concentrated in the stocks mentioned earlier. Ordinarily it would have been next to impossible for the usual liquidity in each of these stocks to deal with this volume of selling without significant price declines, however local demand absorbed them relatively comfortably. For January and February: TASC was -6.7% and -12.3%, IBSD was -10.3% and -11.9%, and BMNS was -3.0% and 0.0% respectively. Bank of Baghdad (BBOB), another foreign favoured stock, on the other hand was up +7.1% in February, reflecting foreign buying after experiencing heavy foreign selling in January that saw it down -6.7% then.

(Source: Iraq Stock Exchange, Asia Frontier Capital, monthly data)

The market’s action indicates that it is bottoming and that stock prices have discounted enough negatives that would comfortably include all of the current concerns – especially considering that the action in January and February comes at the end of a brutal multi-year bear market with back to back declines of -1.3% in 2019, of -15.0% in 2018, -11.8% in 2017, -17.3% in 2016, -22.7% in 2015, and -25.4% in 2014.

Foreign sellers would have had a smorgasbord of concerns to choose from: Some could be expectations of instability arising from the current political chaos in Iraq, ramifications of the US-Iran tensions, and the spill over effects of these on the Iraqi economy. Or the speed and extent of the advance of the coronavirus raising fears of a worldwide pandemic, the effects of this spread on the world economy, and the subsequent consequences for oil prices – the major source of Iraq’s earnings.

However, as serious as these concerns are, the latest macro figures show that they had a short-term effect on the Iraqi economy that has subsided – at least this is the message as of end of February. The first of these macro figures is the market price of the exchange rate of the Iraqi Dinar (IQD) versus the USD, which continues to decline and converge to the official price by end of February, after recovering from mid-January onwards as reported here last month. It is now at the lower end of levels that prevailed over the last 20 months since it began diverging in October following the countrywide demonstrations, and spiking following the events at the start of the year as can be seen below:

(Source: Central Bank of Iraq, Iraqi Foreign Exchange Houses, Asia Frontier Capital)

More importantly the premium of the IQD-USD exchange rate for physical USD notes has returned to the lower end of its normal range of 2-4% over the market price of the USD (red line in chart above). This premium widened significantly during the spikes in the market rate for USD earlier in the year but settled down to about an 8% premium by the end of January, and then to under the 2-4% range by the end of February. All of this argues that the FX market is indicating that the disruptions to economic activity over the last few months have subsided considerably. Although the counter argument would be that the decline in the premium is a function of weakening demand in the cash dominated local retail and trade markets. But then the volumes in the Central Bank of Iraq (CBI)’s daily currency auctions, which are a function of bids or orders for USD, have been mostly at the same levels that prevailed over the last 20 months or so and thus it’s difficult to argue that end demand has weakened, but this counter argument cannot be dismissed yet.

The uncertainties, and differing interpretations of the health of the economy, will continue to persist until other macro data for January, February and beyond are released by the CBI over the next few weeks. Whichever interpretation prevails, preliminary data on the deposit component of the monetary base M0 (i.e. commercial bank’s reserve deposits with the CBI) show a meaningful drop in January from the levels of the last few months as can be seen below. A decline in banking reserves held with the CBI would be due to drops in customer (consumer, business and government) deposits held with these banks.

(Source: Central Bank of Iraq, Asia Frontier Capital, data as of end of January 2020)

This drop argues that the significant geopolitical events early in the year had a meaningful negative impact on the economy in January. Although the deposit component of the monetary base M0 by end of January recovered from the larger drop seen in the middle of the month, the preliminary nature of this data precludes any definite answer. Moreover, updated CBI figures would be overall figures which would not broken down into consumers, businesses or government deposits. Moreover, it’s equally difficult to see if this was a phenomenon for January and that February would begin to witness a recovery or if it would be an extension of January.

Until newer data suggests otherwise, the most likely explanation is that the disruptions to economic activity, and in particular to the cash-dominated retail and trade markets, led to a decline in deposit formation as cash was used by companies/corporates to fund operations in an environment of declining sales. Partially supporting this argument, are CBI data as end of November 2019 for private sector deposits and loans, which shows continued growth in deposits and loans, with deposits ahead, as can be seen from the chart below.

(Source: Central Bank of Iraq, Asia Frontier Capital, data as of end of November 2019)

Earnings data from two of the leading banks, National Bank of Iraq (BNOI) and the Commercial Bank of Iraq (BCOI) support the continuation of these trends into end of 2019. BCOI reported a drop of -4% in loans in 2019 over 2018, but deposits increased by +9% in the same period. While, BNOI reported a +120% increase in loans in 2029 over 2018, and deposits increased by 32% in the same period. The difference in performance reflects the different positions of each bank and its growth strategy – which would be seen as other leading banks report over the next few weeks.

Quarterly earnings data, especially for BNOI which has been leading the banking sector in 2019, lend credence to linking the divergence between the market price of the USD from the official price, that began in October of 2019, to the disruptions to economic activity from the start of countrywide demonstrations then. These quarterly data show a sequential slow-down or decline in these metrics by the fourth quarter (Q4). Loans increased by +2% in Q4 over Q3, +22% in Q3 over Q2, and +39% in Q2 over Q1. Deposits on the other hand declined -14% in Q4 over Q3, increased +20% in Q3 over Q2, and +22% in Q2 over Q1 – while Q4 numbers would be affected by year-end requirements for closing the books, which in Iraq are both cumbersome and time consuming. Nevertheless, the decline in deposits in Q4 would argue that the use of cash, through deposit withdrawals, by companies/corporates to fund operations might have started earlier than January as argued in an earlier paragraph.

Overshadowing the economic data is the continued political paralysis and the inability of the political class to deal with the demands of the five-month long youth-led protest movement. In the last few weeks an unsustainable holding pattern has developed in which the nationwide demonstrations persist, in passion if not in the same intensity of earlier months, while the repression apparatus of the state and the sub-actors continues to take its toll in casualties- both in death and injuries. For now, the political class’s existential fear from the demonstrations has subsided enough for it to return to the old political squabbles as can be seen from the difficulties that the prime minister-designate faced in forming a government. These proved too difficult to surmount which eventually forced him to withdraw his nomination. This means a new search began for the illusive candidate that would square the circle- i.e. satisfy the protest movement’s demands for change, while preserving the status quo for the political elite.

The political class’s existential fear from the demonstrations will continue to ebb and flow, and thus these political uncertainties are likely to continue. However, the economic consequences would be the same whether a new government forms under another prime minister-designate, or if the current caretaker government continues to limp on. These consequences would be that no new budget will be passed and thus the government continues to implement the current spending parts of 2019’s expansionary budget. While it is difficult to estimate the medium-term effects of the disruption to the world economy from the coronavirus and thus on oil prices, yet the government has enough fire power to continue this expansionary budget at least for 2020. This firepower is in the form of a likely year 2019 surplus of USD 2-4 bln for a total of a three-year surplus of USD 25-27 bln – more than enough to compensate for any shortfall in oil revenues during 2020.

Drops in oil revenues in 2020 are likely to happen given the severe drop in global oil prices over the last few weeks as seen in February’s export data. Oil exports in February were about USD 5.1 bln down from USD 6.2 bln in January, reflecting a drop in Iraqi oil price from USD 60.14 per barrel in USD 51.37. However, exports increased to 3.887 mln barrels per day (bpd) in February, up from 3.694 mln bpd in January and therefore revenues from oil exports would be about USD 5.5 bln, and not USD 5.1 bln, if February had 31 days and not 29 days making for better month-on-month comparisons.

Please click here to download Ahmed Tabaqchali’s full report in pdf format.

Mr Tabaqchali (@AMTabaqchali) is the CIO of the AFC Iraq Fund, and is an experienced capital markets professional with over 25 years’ experience in US and MENA markets. He is a non-resident Fellow at the Institute of Regional and International Studies (IRIS) at the American University of Iraq-Sulaimani (AUIS), and an Adjunct Assistant Professor at AUIS. He is a board member of the Credit Bank of Iraq.

His comments, opinions and analyses are personal views and are intended to be for informational purposes and general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any fund or security or to adopt any investment strategy. It does not constitute legal or tax or investment advice. The information provided in this material is compiled from sources that are believed to be reliable, but no guarantee is made of its correctness, is rendered as at publication date and may change without notice and it is not intended as a complete analysis of every material fact regarding Iraq, the region, market or investment.

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Rabee Securities Iraq Stock Exchange (ISX) market report (week ending: 5th March 2020).

Please click here to download a table of listed companies and their associated ticker codes.

The RSISX index ended the week at IQD610 (+1.7%) / $654 (+1.7%) (weekly change) (-7.4% and -6.7% YTD change, respectively). The number of week traded shares was 10.4 bn and the weekly trading volume was IQD31.3 bn ($25.8 mn).

ISX Company Announcements

  • The Center for Banking Studies at the Central Bank of Iraq organized a seminar titled Governance of Governmental Banks, presented by Dr. Khawla Talib Al-Asadi, former General Manager of the Rafidain Bank. The symposium included several axes on the importance of structuring and governing banks to manage their risks, the importance of automating operations, and developing internal control systems. (CBI)
  • ISX suspended trading of Elaf Islamic Bank (BELF) starting Mar. 5, 2020 due to the AGM that will be held on Mar. 10, 2020 to discuss and approve 2018 annual financial statements.
  • Al-Ameen Financial Investment (VAMF) held its GA on Mar. 5, 2020 to elect 5 new original and 5 alternative board members.
  • The legal procedures of adjusting article 1 of The Light Industries (ITLI) company contract has been completed and the company has changed its name from The Light Industries to Light and Mining Industries (ITLI).

By John Lee.

The National Investment Commission (NIC) has announced the following investment opportunities:

(Source: National Investment Commission)

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Rabee Securities Iraq Stock Exchange (ISX) market report (week ending: 27th February 2020).

Please click here to download a table of listed companies and their associated ticker codes.

The RSISX index ended the week at IQD600 (+0.5%) / $6439 (+0.1%) (weekly change) (9.0% and -8.2% YTD change, respectively). The number of week traded shares was 6.1 bn and the weekly trading volume was IQD5.8 bn ($4.8 mn).

ISX Company Announcements

  • ISX will suspend trading of Elaf Islamic Bank (BELF) starting Mar. 5, 2020 due to the AGM that will be held on Mar. 10, 2020 to discuss and approve 2018 annual financial statements.
  • Al-Qabedh Islamic Bank for Finance & Investment (BQAB) resumed trading on Feb. 27, 2020 after discussing and approving the financial statements belong to following periods Jan. 1, 2015 – Dec. 31, 2015, Jan. 1, 2016 – Oct. 17, 2016 (while it was a money transfer company), and the following periods Oct. 8, 2016 – Dec. 31, 2016, Jan. 1, 2017 – Dec. 31, 2017 belong to it after becoming an Islamic Bank.
  • Iraq Baghdad for General Transport (SBPT) invited its shareholders to receive their 2018 dividends. The company announced in December 2019 that it had decided in its AGM held on Dec. 15, 2019 to distribute 100% cash dividend (IQD1.00 dividend per share, 4.9% dividend yield).
  • ISX requested Erbil Bank for Investment and Finance (BERI) to provide its AGM minutes for the GA held on Feb. 22, 2020.
  • Mansour Hotel (HMAN) resumed trading on Feb. 25, 2020 after discussing and approving 2018 annual financial statements.
  • According to the ISC decision, Al Nibal Al Arabya for Money Transfer (MTNI) has been delisted from the ISX starting Feb. 24, 2020 due to the shift in the company’s activities from money transfer company into an (A) class exchange company and lower the company’s capital to suit its new activity.
  • ISX suspended trading of Al-Ameen Financial Investment (VAMF) starting Feb. 24, 2020 due to the GA that will be held on Feb. 27, 2020 to elect 5 new original and 5 alternative board members.
  • Cross transactions: 3.1 bn shares of Trans Iraq Bank for Investment (BTRI) on Feb. 27, 2020, which represents 1.2% of BTRI’s capital.